As of May 31, 2014, Michigan Saves has approximately $11.5 million of funds on hand, which are invested according to short- and long-term investment policy statements approved by the board.
This request seeks proposals from qualified firms to:
- Invest the restricted and unrestricted assets of the organization according to projected cash flow needs and schedules of future liabilities.
- Advise the executive director, treasurer, and accountants of the organization on cash management procedures and cash flow considerations.
- Assist the board’s Finance Committee in reviewing the investment policy statements.
- Provide monthly reports to the executive director and Finance Committee on the value of investments.
- Attend (either in person or via teleconference) meetings of the Board of Directors on an as-needed basis.
The importance of the first two bullets above—investing the restricted and unrestricted assets of the organization and managing cash flow—cannot be overemphasized. Because the majority of funds held by Michigan Saves are in the form of a loan loss reserve pool, Michigan Saves, in many respects, behaves like an insurance company. At full operation, we will hold $10.1 million in assets—leveraged between 5:1 and 20:1—against a known pool of potential and capped losses. Each month, some of the losses are realized (loans default, converting potential liability to actual liability), new loans are written (therefore incurring new potential liabilities), and other loans are repaid (thereby removing all potential liability for that particular loan). (See attached internal management controls for section II for information on loan loss reserve business rules.) Investment earnings are expected to help fund ongoing operations and/or replace loan loss reserve funds as payments are made to lenders for loan or lease defaults. Maximizing investment earnings, while minimizing risk and the costs associated with management fees, is an important factor in evaluating potential investment management firms.
Michigan Saves is staffed by Public Sector Consultants Inc. and accounting services are provided by a third-party accounting firm. It is vital for the investment management firm to work in concert with our staff and our accountants to maintain the flow of both payments and receipts for these funds.
If you have any questions, you are welcome—and encouraged—to contact the executive director at any point between now and the RPF due date. Mary Templeton, executive director, can be reached at (517) 371-7453 or firstname.lastname@example.org.
The deadline for response is noon, July 15, 2014.
Download a PDF of the full RFP.